British equities jumped on Wednesday as investors cheered a surprise drop in domestic inflation, which spurred hopes that the Bank of England (BoE) could consider interest rate cuts early next year.
The blue-chip FTSE 100 (.FTSE) advanced 0.9% as of 0902 GMT, touching its highest level since May. 24 earlier in the session, outpacing the pan-European STOXX 600 (.STOXX), which was trading flat.
The pound dropped 0.5% after official data showed British inflation fell by more than any economist polled by Reuters predicted in November, pushing the headline rate to its lowest since September 2021.
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